[Click eStock] "LG Energy Solution, 3Q Sales Decline Inevitable... Target Price Down"

On the 22nd, Samsung Securities lowered the target price for LG Energy Solution from 740,000 KRW to 660,000 KRW. However, the investment rating was maintained as 'Buy.'

LG Energy Solution Headquarters, Yeouido-daero, Yeongdeungpo-gu, Seoul. Photo by Jinhyung Kang aymsdream@

LG Energy Solution's third-quarter revenue is estimated to be 8.343 trillion KRW, down from 8.773 trillion KRW in the previous quarter. Operating profit is also expected to fall short of market expectations of 710 billion KRW, at 668.3 billion KRW. This is due to a decline in automobile battery sales and a slowdown in the profitability of small batteries.

Accordingly, the performance expectations for the second half of the year have been revised downward. Due to concerns over weak demand caused by price competition among upstream companies, the fourth-quarter earnings forecast was also lowered by 9%.

Hyun-ryeol Cho, a researcher at Samsung Securities, said, "After market expectations for profitability have been lowered, investment sentiment is expected to recover." He added, "If price competition and sluggish sales among electric vehicle manufacturers intensify, LG Energy Solution's diversified regional and customer portfolio appeal will be highlighted." He further noted, "In particular, the fact that the company is most dependent on customers who are currently achieving the most successful sales performance through price reductions is also positive."

This content was produced with the assistance of AI translation services.